July 09, 2009
For its continued non-compliance with Orders asking it to correct its violations of the Tax Code, a corporation engaged in the food/restaurant business located at a popular mall in Makati City was padlocked today by the Bureau of Internal Revenue (BIR).
Boxed (temporarily closed or suspended) from conducting business after it was ordered closed by BIR Commissioner Sixto S. Esquivias IV in a Closure Order dated July 9, 2009 was FOOD ALCHEMY, INC., also known by its business name of THAI-IN-A-BOX, located at Greenbelt Mall 1, Legazpi Village, Makati City.
Revenue Region (RR) No. 8, Makati City Regional Director Alfredo V. Misajon under whose jurisdiction the operations of Food Alchemy, Inc. falls said that his region was left with no choice but to close said corporation after the latter failed to rectify its violations even after it was given the opportunity to do so through the 48-Hour Notice and Five (5) Day VAT Compliance Notice.
“We wanted to extend a helping hand. Food Alchemy, Inc. had all the chances but failed to refute our findings or to rectify its tax violations. We will be remiss with our sworn duties if we do not impose the appropriate sanctions,” Misajon added.
The grounds cited for Food Alchemy’s closure were violations of Sections 115 (a) (3), 113, 114, 236 and 237 of the National Internal Revenue of 1997, as amended, and as implemented by Revenue Memorandum Order No. 3-2009. The said violations were uncovered during a CRM (Cash Register Machine) Z-reading conducted by field men of RDO No. 47, East Makati, foremost of which is understatement of taxable sales or receipts by 30% or more of correct taxable sales or receipts [Sec. 115 (a) (3)].
Results of said “Z” reading showed that the subject corporation understated its (reported) taxable sales by 47.51% in 2008 and by 41.07% for the first three (3) months of 2009. Sales computed by the BIR during the CRM Z-reading were P4,693,481.72 for 2008, and P1,177,300.20 for the first quarter of 2009. Sales per VAT Returns filed by the corporation however showed a much lower amount – P2,463,736.99 in 2008, and P693,735.99 for the 1st quarter of 2009.
Total understatement of sales by Food Alchemy, Inc. for the above-cited periods stood at P2,713,308.94. Total basic VAT payable is P325,597.07.
“It saddens us to see the fate of the subject corporation come to this conclusion. This feeling notwithstanding, we should put the country’s interest first above anything else. Let this serve as a mirror for other taxpayers similarly-situated. We will help them rectify their violations. If they persist in their unwanted practices, however, we will not hesitate to impose the full force of the law,” Revenue District Officer Ricardo B. Espiritu of RDO No. 47, East Makati emphasized.
Among those previously padlocked by the BIR under this program were: 1) La Suerte Grocery & Bakery in Magalang, Pampanga for failure to declare more than P50M income in 2008; 2) Charmy Food Phils., Inc., a manufacturer of soybean products in Pasig City, for not declaring P40M of its sales for 2005-2008; 3) Arra’s Fine Dining, a Korean Restaurant in Makati City for understatement of its taxable sales in 2008 by more than P20M; 4) Hilton Mart Corporation, a Grocery (Wholesale and Retail) business plying its trade in Manila, for underdeclaring its sales for taxable year 2008 by more than P1.2B; 5) Skywater Enterprises in Davao City for underdeclaring its sales by P12,590,943.55 in 2008; 6) Wil-An Mart, a wholesale and retail grocery business in Manila, with sales underdeclaration in 2008 of 196.24% or P142,466,017.80; 7) Han Nan Food Corporation, a popular Chinese restaurant in Mandaluyong City, for underdeclaring its sales in 2007 and 2008 by more than P27M; 8) Murray’s Wine-Burger Corporation located at Serendra, Bonifacio Global City, Taguig City for underdeclaring its sales in 2009 by P4,604,431.88; and 9) Raiko 10-28 Bar & Restaurant, a.k.a. RATSKY, located at Tomas Morato, Quezon City for failure to declare more than P24M sales in 2007, 2008 and January and February of 2009.
Oplan Kandado is the flagship project of the BIR initiated by Commissioner Esquivias which aims to strictly enforce sanctions for non-compliance by business establishments with requirements of the Tax Code. (rtdlc)
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Please refer to:
(original signed)
RICARDO B. ESPIRITU, Revenue District Officer, RDO No. 47, East Makati
Approved for Release:
(original signed)
ALFREDO V. MISAJON, Regional Director, RR No. 8, Makati City
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